Supreme Court seeks a way around “perpetual copyright” on foreign goods

If the Supreme Court is looking for a middle ground in Wiley v. Kirtsaeng, it's going to be hard to find. That copyright case, argued this morning, could have a big impact on resale markets around the country.

It's impossible to know from reading into oral arguments which way the court will go. Questions from the bench today show the justices are seriously concerned about the possible effects on resellers of common goods, as well as legal obstacles that could be created for museums and libraries. At one point, Justice Stephen Breyer grilled Wiley's lawyer about how a victory for his side would avoid interfering with the sale of millions of used Toyotas.

At the same time, at least some justices are concerned with copyright owners' right to engage in "market segmentation," and charge different prices in different countries. As for the grad student turned book-importer who challenged that system, Supap Kirtsaeng, there wasn't much sympathy to be found. Justice Elena Kagan casually referred to him as a "rogue" at one point.

The case started in 2008, when textbook manufacturer John Wiley & Sons sued Supap Kirtsaeng for re-selling textbooks he bought in Thailand on the cheap. Wiley argues that by importing and selling the books without permission, Kirtsaeng violated copyright law—even though the books aren't pirated, they're simply cheap foreign editions. Wiley won its case at the US Court of Appeals for the 2nd Circuit, and now the stakes have become higher. Kirtsaeng's inability to win the case on "first sale" grounds has alarmed an array of groups—from retailers to museums and libraries—all of whom believe copyright owners might interfere with their own resale and lending.

A "parade of horribles" comes to life

Wiley's lawyers said those imagined consequences (content company lawyers messing around with garage sales or library lending) were wild speculation, a 'parade of horribles' used to sway the case their way. Under questioning, though, he admitted that copyright owners might need to be asked permission for some activities—even by non-profits like museums.

The justices weren't quite ready to blow off the 'horribles' so easily, either. Justice Stephen Breyer, in particular, insisted on going through examples of what might happen should Wiley's view carry the day.

"Imagine Toyota, right?" said Breyer. "Millions sold in the United States. They have copyrighted sound systems. They have copyrighted GPS systems. Under [Wiley's] reading, the millions of Americans who buy Toyotas could not resell them without getting the permission of the copyright holder of every item in that car which is copyrighted? Am I right or am I wrong? "

"There are other defenses, but that is not this case," said Wiley's lawyer, famed Supreme Court advocate Ted Olson. "This case is not--"

Breyer interrupted him: "Well, how do you distinguish? How do you distinguish?"

Later, he went in for more examples:

"If you were the lawyer for the Toyota distributor, [or] if you were the lawyer for the Metropolitan Museum of Art, or you are the lawyer for a university library," said Breyer. "Your client comes to you and says, 'My God, I just read the Supreme Court opinion. It says that we can't start selling these old books, or lending them, or putting them in our word processor, or reselling the Toyota, [or] displaying the Picasso without the permission of the copyright holder.' What, as their lawyer, do you tell them? Do you tell them, 'hey, no problem?' Or, do you tell them, 'you might become a law violator?' Or, do you tell them, 'I better litigate this?' What do you tell them?"

"Well, each one of those situations that you posit, Justice Breyer, has a whole panoply—a set of facts," said Olson. "With respect to the museums, with respect to the person bringing books into the United States, there are other defenses, including fair use."

Of course, fair use wouldn't be much of a defense for selling a used Toyota or for displaying a work in public. Chief Justice John Roberts immediately pointed that out.

Other justices showed they took Kirtsaeng's list of 'horribles' seriously, too. "You have to look at those hypotheticals in order to decide this case," said Justice Anthony Kennedy. Justice Sonia Sotomayor noted the Solicitor General and two courts of appeals have already written exceptions "to take care of what they perceive as 'horribles.'" The statute may need to be given "a more rational meaning," she said.

Notably, Olson didn't back away from the more extreme consequences of his client's win at the 2nd Circuit. If Wiley wins, he said, institutions like museums and libraries might need to get licenses from copyright owners for their activities.

"If you're going to use the product... in a way that's contemplated by the copyright laws, maybe it's required that you actually comply with the copyright laws by going to the owner of the copyright and saying, look, here's what I propose to do, can I have a license to do this? It's a nonprofit, it's a museum."

No problem with "market segmentation;" plus little sympathy for Kirtsaeng

While the justices showed great concern for how the case might affect libraries, museums, and used-car dealers, some also seemed sympathetic to the idea that Wiley had a right to engage in "market segmentation."

Kirtsaeng's lawyer, E. Joshua Rosenkranz, explained the intent of including an importation right in copyright law was to go after "rogue distributors"—not to shut down resale markets.

"You said that one of the things that they wanted was the segmentation of market; they got half of it," said Justice Elena Kagan. "They got the rogue distributors' half… that's a crazy half to have gotten. That's the kind they don't need," because they can already attack those distributors with contract law.

She continued: "And then they don't get people like, frankly, your client, who are rogue something elses, with no contractual privity [relationship]. And what sense does that make?"

"It makes perfect sense, Your Honor," answered Rosenkranz. "Obviously, you know, the industry, at least back in 1976, did not get everything that they wanted."

A middle road?

The US government also had a representative in the case, Deputy Solicitor General Malcolm Stewart. He tried to guide the court toward a kind of middle ground, although one that still largely favored Wiley over Kirtsaeng.

By tying their decision to a 1909 case called Bobbs-Merrill, the court could allow copyright owners to shut down unauthorized distributors like Kirtsaeng but avoid the more extreme position that Wiley has found itself fighting for, said Stewart. (If Wiley wins outright, goods manufactured abroad could actually enjoy copyright protection indefinitely.) Copyright owners could get some control over imports, without granting them control over all downstream sales.

While that middle ground may hold appeal for some justices, like Kagan, others expressed skepticism that it could be navigated under existing law.

"That's an awfully difficult maze for somebody to get through," said Roberts. "It's not that complicated under [Kirtsaeng's] approach. It says once you've you had a first sale, that's it."

Near the end of the argument, Justice Samuel Alito got down to brass tacks. Semantics aside, he wanted to know how would Stewart choose between two unappealing options.

"Which of the following is worse," asked Alito. "All of the horribles that [Kirtsaeng] outlines… or the frustration of market segmentation, if [his] position were accepted?"

"Well, if they actually happened, then I think the horribles would be worse," said Stewart. "But, as I say, we feel that we have offered a reading of all the statutory provisions together that would avoid both."

"If that middle ground were found not to be viable, which of the two sets of consequences is worse, from the government's perspective?" Alito continued.

With that, the argument wrapped up just after noon. A decision will be made some time in the coming months. In the meantime, everyone at the court has more immediate concerns. Hurricane Sandy left the capital "drenched and desolate" today, and it was somewhat surprising that arguments even took place, since the rest of the federal government had already shut down. Tuesday's arguments have been re-scheduled.

I suppose this brings to mind a similar question - If I can find legitimate DVDs and books more cheaply in another part of the world than where I live now, and I bring them home, who exactly would I be hurting? Sure, I'm not purchasing it for the list price in my own country, but it's not my fault that the rightsholders are offering it for that price. I voted with my wallet, which is what we're always being encouraged to do. I don't think it's fair what happened to Wiley, but I also don't think it's fair that higher-education textbooks, and many goods in general, are sold at drastic price differentials.

"You said that one of the things that they wanted was the segmentation of markets--they got half of it," said Justice Elena Kagan. "They got the rogue distributors' half… that's a crazy half to have gotten. That's the kind they don't need," because they can already attack those distributors with contract law.

What right does some arbitrary company have to say that one market can have a given good for $x, but I have to pay twice as much just because I live in a different market?

I understand that's what this case is all about, but in this day and age I find this to be utter BS. Corporatism at its finest: Making a buck at the individual's expense. Corporations are here to serve the needs of the people, not the other way around.

This should be a no-brainer. The 'horribles' are the immediate and unavoidable byproduct of any reading other than that of the first-sale doctrine. The plaintiff's position should not even be an idea that is taken seriously.

It's heartening, at least, to see Roberts and Alito asking some tough questions of the Wiley counsel and Deputy Solicitor General. Since this is fundamentally a case of corporate profiteering versus consumer rights, it's a given which side Scalia and Thomas will take. Typically you'd expect Roberts and Alito to fall in the same line, leaving Kennedy as the swing vote, but perhaps not. Roberts has already broken with his fellow conservatives on one big case this year; twice will make him mighty unpopular with the people who selected and confirmed him. Very interesting stuff, even as scary as the potential of a Wiley victory is.

Sounds like the judges are actually exhibiting some common sense. The fact that even Wiley's lawyer was forced to admit the possible consequences (likely, actually, law once decided is seldom held back) are worse than his company not being able to overcharge for textbooks must have hurt his lawyerly... soul, I guess I should call it.

I personally don't have much sympathy for textbook publishers, they rip off students for insane sums of money just to buy the latest textbook with pictures and pages re-shuffled around so you can't use previous years. You can't restrict property rights simply because corporations want to make more money. Fortunately, it really sounds like the SCOTUS isn't going to.

"You said that one of the things that they wanted was the segmentation of markets--they got half of it," said Justice Elena Kagan. "They got the rogue distributors' half… that's a crazy half to have gotten. That's the kind they don't need," because they can already attack those distributors with contract law.

What right does some arbitrary company have to say that one market can have a given good for $x, but I have to pay twice as much just because I live in a different market?

I understand that's what this case is all about, but in this day and age I find this to be utter BS. Corporatism at its finest: Making a buck at the individual's expense. Corporations are here to serve the needs of the people, not the other way around.

The technical term is third-degree price discrimination, and think carefully before you decide it should be abolished. Everything from newspaper coupons to student discounts to matinee prices to frequent flyer upgrades to casino comps to doorbuster sales all rely on the same right to charge prices as the company sees fit (provided they don't screen on some protected category like race or religion). Are textbook publishers being jerks by charging higher prices to US customers? Yes. Does the US prohibit being jerks? No.

If you don't like the text publishers' practices, push your schools toward using open course materials or find/establish a publisher that doesn't play these games. A small saving on student loan debt is not worth taking a wrecking ball to the economy.

As someone who actually has to deal with it, unlike I imagine the "communism!" comments above, it's a very tough case. And I agree it's good to see them really getting down to the nitty-gritty.

To give an example, you want to put a product into (say) Poland. It's not cost effective to localise, but most Poles speak English well enough, so the distributor is happy with English goods. In Poland the $40 game is going to sell for $3, because otherwise nobody would be able to afford it.

Now, as the Justices noted, contractually the distributor most definitely isn't allowed to then send these $3 copies back to another territory and sell them for $40 (ignoring that you'd have to catch and then sue them to actually prevent it, but hey).

In this case you are probably in Polish packaging, so it's not quite as bad as a book where it is probably identical to the English version, at least in content.

<Note: Poland and the costs are just made up. So no posts about Polish GDP and average wages. It's just shorter to type than Kazakhstan or something >

Now - if every time you sold English product into a lower-cost territory you had it all scooped up and channeled back to compete with your 'full price' English product then there is going to be a simple outcome. No product into lower cost territories.

Now, copyright is most definitely not the tool for the job here - the list of horribles is just that! But hopefully it can now be seen that there are actual reasons for segmentation, and that is allows people to access goods which otherwise they could not afford.

Sounds like the judges are actually exhibiting some common sense. The fact that even Wiley's lawyer was forced to admit the possible consequences (likely, actually, law once decided is seldom held back) are worse than his company not being able to overcharge for textbooks must have hurt his lawyerly... soul, I guess I should call it.

I personally don't have much sympathy for textbook publishers, they rip off students for insane sums of money just to buy the latest textbook with pictures and pages re-shuffled around so you can't use previous years. You can't restrict property rights simply because corporations want to make more money. Fortunately, it really sounds like the SCOTUS isn't going to.

Lets hope, anyways.

While I personally like the idea of extracting vengance from textbook publishers, it's the wrong approach to take. This should be a simple matter of property law. Corporations and individuals should be able to dispose of their property in any manner that they see fit. The fact that it happens to be a copy of someone's creative work should not matter in the slightest.

None of these judges should even be entertaining the idea that some notion of a right to "market segmentation" should ever override basic individual liberties.

I don't think market segregation is a practice that should be supported by the law as it's very lopsided.

Companies are always arguing for free markets, for the ability to produce where it's cheapest and sell where it's most profitable. Fine. But if you as producers get free markets, the we as workers and consumers do too.

If producers want government enforced market segregation, then it should go both ways, and jobs can't be outsourced.

Personally, I'm in favor of the first approach: free markets for all, including consumers.

"You said that one of the things that they wanted was the segmentation of markets--they got half of it," said Justice Elena Kagan. "They got the rogue distributors' half… that's a crazy half to have gotten. That's the kind they don't need," because they can already attack those distributors with contract law.

What right does some arbitrary company have to say that one market can have a given good for $x, but I have to pay twice as much just because I live in a different market?

I understand that's what this case is all about, but in this day and age I find this to be utter BS. Corporatism at its finest: Making a buck at the individual's expense. Corporations are here to serve the needs of the people, not the other way around.

The technical term is third-degree price discrimination, and think carefully before you decide it should be abolished. Everything from newspaper coupons to student discounts to matinee prices to frequent flyer upgrades to casino comps to doorbuster sales all rely on the same right to charge prices as the company sees fit (provided they don't screen on some protected category like race or religion). Are textbook publishers being jerks by charging higher prices to US customers? Yes. Does the US prohibit being jerks? No.

If you don't like the text publishers' practices, push your schools toward using open course materials or find/establish a publisher that doesn't play these games. A small saving on student loan debt is not worth taking a wrecking ball to the economy.

Corporations are free to try price discrimination. They can take their chances in the marketplace.

The problem is the idea that they get to use the government to enforce their will.

What right does some arbitrary company have to say that one market can have a given good for $x, but I have to pay twice as much just because I live in a different market?

I understand that's what this case is all about, but in this day and age I find this to be utter BS. Corporatism at its finest: Making a buck at the individual's expense. Corporations are here to serve the needs of the people, not the other way around.

Because the alternative is setting one price for the entire world, which would exclude huge regions from having access to those products at all.

Stuff that is covered under copyright (and non-obvious patents) generally has a large upfront cost and small reproduction costs. Suppose you budget the production of a game such that you can recoup those upfront costs by sell 10k copies at normal game prices in the 1st world*. Now that no-one living in the 3rd world can afford your game. However, it makes no point to hold it back from them, because it costs next to nothing to make copies, so even if you only make 10 cents on each copy sold there, it is still better than not selling it at all. On the other hand, if all your customers were paying that price there is no way you would be able to recoup your costs.

Market segmentation can be very good thing for all parties involved.

* Yes I know I am abusing these terms using them in the colloquial economic meanings, rather than their historical meaning.

I don't think they should be denied the opportunity to try and charge different markets different prices.

I just also don't think I should be prohibited from finding the best possible prices. It's no different, in my mind, than going to a different Best Buy sales market because it's enough cheaper to make it worthwhile. Or ordering online because it's cheaper than the university bookstore.

The fact of the matter is that their existing, screw-the-consumers business model is unsupportable because the world is functionally smaller. They're just going to have to find a new way to stay afloat. Minimizing overhead would be a good start...you know, ebooks.

As someone who actually has to deal with it, unlike I imagine the "communism!" comments above, it's a very tough case. And I agree it's good to see them really getting down to the nitty-gritty.

To give an example, you want to put a product into (say) Poland. It's not cost effective to localise, but most Poles speak English well enough, so the distributor is happy with English goods. In Poland the $40 game is going to sell for $3, because otherwise nobody would be able to afford it.

Now, as the Justices noted, contractually the distributor most definitely isn't allowed to then send these $3 copies back to another territory and sell them for $40 (ignoring that you'd have to catch and then sue them to actually prevent it, but hey).

In this case you are probably in Polish packaging, so it's not quite as bad as a book where it is probably identical to the English version, at least in content.

<Note: Poland and the costs are just made up. So no posts about Polish GDP and average wages. It's just shorter to type than Kazakhstan or something >

Now - if every time you sold English product into a lower-cost territory you had it all scooped up and channeled back to compete with your 'full price' English product then there is going to be a simple outcome. No product into lower cost territories.

Now, copyright is most definitely not the tool for the job here - the list of horribles is just that! But hopefully it can now be seen that there are actual reasons for segmentation, and that is allows people to access goods which otherwise they could not afford.

You're really doing nothing more than arguing that the publisher should be free to abuse their monopoly. They can ignore the fact that the marginal production cost is FAR below what they think their "rich" customers will bear. They think they can get away with gouging us and that's a foolish assumption. Such ideas are likely to end up causing their own destruction as they lose the ability to compete with other forms of distraction.

It's a "Let's soak the rich" argument but it's for poor working class schmucks in the 1st world.

"You said that one of the things that they wanted was the segmentation of markets--they got half of it," said Justice Elena Kagan. "They got the rogue distributors' half… that's a crazy half to have gotten. That's the kind they don't need," because they can already attack those distributors with contract law.

What right does some arbitrary company have to say that one market can have a given good for $x, but I have to pay twice as much just because I live in a different market?

I understand that's what this case is all about, but in this day and age I find this to be utter BS. Corporatism at its finest: Making a buck at the individual's expense. Corporations are here to serve the needs of the people, not the other way around.

Agreed. Globalization is good for corporations yet the citizenry is to be forbidden it's benefits? That's absurd.

As someone who actually has to deal with it, unlike I imagine the "communism!" comments above, it's a very tough case. And I agree it's good to see them really getting down to the nitty-gritty.

To give an example, you want to put a product into (say) Poland. It's not cost effective to localise, but most Poles speak English well enough, so the distributor is happy with English goods. In Poland the $40 game is going to sell for $3, because otherwise nobody would be able to afford it.

Now, as the Justices noted, contractually the distributor most definitely isn't allowed to then send these $3 copies back to another territory and sell them for $40 (ignoring that you'd have to catch and then sue them to actually prevent it, but hey).

In this case you are probably in Polish packaging, so it's not quite as bad as a book where it is probably identical to the English version, at least in content.

<Note: Poland and the costs are just made up. So no posts about Polish GDP and average wages. It's just shorter to type than Kazakhstan or something >

Now - if every time you sold English product into a lower-cost territory you had it all scooped up and channeled back to compete with your 'full price' English product then there is going to be a simple outcome. No product into lower cost territories.

Now, copyright is most definitely not the tool for the job here - the list of horribles is just that! But hopefully it can now be seen that there are actual reasons for segmentation, and that is allows people to access goods which otherwise they could not afford.

Except that in the real world, games cost MORE over in those countries than here in the United States.

Bottom line is that these companies should be told "One price for the entire world, period and done with!"

Then, we would FINALLY get a legitmate price in America on games, movies and music of 30 dollars/10 dollars/10 cents a song finally.

Vendors may in some sense have a "right" to try to implement "market segmentation".

But since when does a seller's desire to practice "market segmentation" equal a "right" to have the law enforce that strategy, when the customers seek to side-step such market pricing manipulations?

There is no customer involved in this trial; Kirtsaeng was acting as an unlicensed importer which is illegal on its face. I don't know why they are even invoking copyright, because it's just as illegal to have your family ship you a bunch of iPad cases or laser pointers or whatnot for resale.

Since this somehow became a copyright case, the Supremes are going to have to thread a needle to avoid damaging property rights and/or free enterprise. Because adopting Kirtsaeng's logic or Wiley's logic will damage the economy in many ways.

NEW YORK (CNNMoney.com) -- Would you be willing to pay the original builder a fee when you resell your home? That's an obligation some developers are trying to slap on homeowners in their communities.

Many condo and townhouse dwellers are already familiar with the "flip tax," more formally known as a resale fee. Typically calculated as a percentage of the sale price, it's a fee due to the condo association or community when an owner sells. These charges fund common-area maintenance or provide a boost to reserve funds, which benefits the association's homeowners [sic].

But in some new developments, homebuilders are including in contracts a 1% fee to be paid to them every time the house is sold -- for 99 years. And the money doesn't go for improvements or upkeep: It's just money in the builders' pockets.

Consider the following scenario: you are in the process of selling your home. You've found a buyer who is willing to pay you $200,000. Your realtor has assured you that everything is going smoothly-- she says the buyer has lined up financing and there were no problems with the home inspection and the appraisal.

Then, days before the closing, your realtor gives you a call. "Uh, something has turned up during the title search that is going to be a problem," she says. "I don't know if you were aware of this, but your property has a private transfer fee covenant on it."

"What does that mean?" you say.

"It means you will have to pay an extra $2,000 fee at the closing," she informs you. "And the buyer is demanding that you reduce the sale price by $10,000 or the deal is off because of this." ...

A home that sells once about every seven years will have a 1 percent fee paid approximately 14 times. All those future fees represent equity that will be leeched out of the property. Cumulatively, the value of that equity which will be skimmed by [the developer] is far more than 1 percent.

Historically British courts were somewhat dubious about deed restrictions because they thought over time use restrictions would accumulate and reduce the value of property, but as we know the US judiciary buys the argument that restrictions are good for property values because they prevent unwanted uses of land.

pappypappy - I don't use the word communism lightly. But that IS what they are suggesting. They want the government to enforce their business model to charge rich people more than poor people. It may be cliche to use the word, but in this case its accurate.

Further, if the company can afford to sell the game for $3 in Poland, then why aren't they charging me $3? A free market would state that they sell it for some certain price to maximize profits. If that price is too much for Poland, that's unfortunate for Poland. However, that fact then creates opportunities in Poland for a cheaper product (maybe the open source book). The company is free to try and charge what they want, but the should be free to correct itself as necessary.

Since when is price discrimination a 'right' ? Some of these SCOTUS justices are a few cards short of a full deck...

And when I get that tenth cup of coffee for free from the local cafe, you're going to send in the goons to arrest the proprietor? The company has property rights, too, and it has the right to charge whatever (ill-advised) price it decides for a particular market, up to and including handing out discounts to repeat customers.

Mandating a global price will not decrease US prices to those you are seeing overseas. The bulk of the profit comes from markets paying US-like prices, so that is the price that would prevail. So to satisfy your pride of getting the best price, you would deny access to those in poorer countries? (Not "you" and "your" personally, but in a generic sense.)

Edit: fixed a non-sequiter in the first paragraph to tie together the sentences.

I suppose this brings to mind a similar question - If I can find legitimate DVDs and books more cheaply in another part of the world than where I live now, and I bring them home, who exactly would I be hurting? Sure, I'm not purchasing it for the list price in my own country, but it's not my fault that the rightsholders are offering it for that price. I voted with my wallet, which is what we're always being encouraged to do. I don't think it's fair what happened to Wiley, but I also don't think it's fair that higher-education textbooks, and many goods in general, are sold at drastic price differentials.

In the case of DVDs, the copyright holders dealt with this by getting manufacturer's to implement Regional Code recognition in the DVD players. In this case such techno-fixes aren't feasible, so now "IP holders" are trying to use the law to fill the same function.

Perhaps someone remembers the details on the legal status of breaking/unsetting Regional Code limitations on DVD players? Or selling "region-free" DVD players? And why should textbooks receive any more strenuous protection?

Thanks to advancements we have made the "market" for goods has become essentially global, in large part I believe thanks to the Internet. That said governments, currency, and equality have not gone global. This isn't a clear cut issue, but I don't think the US government should be working on the side of profits just for the sake of businesses keeping the status quo.

I don't understand. What is the justification for protecting market segmentation? I understand allowing it if the publishers can get away with it. It happens all the time from student priced movie tickets to car accessories and service packages that have huge margins and appeal to a narrow demographic that cna afford them. Good for them. But I don't understand on what grounds anyone has a _right_ to segement the market, or why that should be legally protected. Is there some legal framework for this?

Since when is price discrimination a 'right' ? Some of these SCOTUS justices are a few cards short of a full deck...

Since congress made it law. Things don't go to the Supreme Court because they are simple and clear-cut. They end up there because congress wrote vague or conflicting laws, and someone has to determine how to rectify them.

In this case, one part of the copyright law, 17 USC 602, gives rights-holders the authority to control importation of their copyrighted works. Another part, 17 USC 109 gives owners of legal copies the right to resell those copies without permission of the rights-holders. The case is over which trumps the other and in what circumstances. There are very interesting nuances to different ways of reading the law (both from a legal and practical point of view), and the arguments show the Supreme Court are very keen on getting all these details right.

I feel grave concern about the plaintiff argument that the arguments represent a speculative "parade of horribles" that copyright holders would not in fact pursue. The use of IP laws in recent years has shown that very broad interpretations can be attempted and that plaintiffs will cheerfully seek crippling penalties (such as barring trade), and this seems to be a worsening trend - the deadlock of "mutually assured destruction" that had companies building IP portfolios but assuring all that these were purely defensive appears to have broken. So even if today Wiley's is honest in disavowing any intention to limit lending, tomorrow they or their successor or competitor may well seek this once the precedent exists to ensure their (legal) success in doing so.

An example of law creep: in the UK the "Regulation of Investigatory Powers Act (2000)" was introduced with the ostensible purpose of regulating the use of surveillance in serious crime cases, with only the police, intelligence services, and some major government departments (tax, health, etc) authorised for this. Subsequent amendment added a long list of other agencies leading to the dire and farcical state that by 2011 local councils were resorting to it eight times a day to investigate cases of school zoning, dog fouling, and smoking. So something sold to the public as being essential to fight terrorism was within a few years being commonly used to prosecute public nuisances.

"You said that one of the things that they wanted was the segmentation of markets--they got half of it," said Justice Elena Kagan. "They got the rogue distributors' half… that's a crazy half to have gotten. That's the kind they don't need," because they can already attack those distributors with contract law.

What right does some arbitrary company have to say that one market can have a given good for $x, but I have to pay twice as much just because I live in a different market?

I understand that's what this case is all about, but in this day and age I find this to be utter BS. Corporatism at its finest: Making a buck at the individual's expense. Corporations are here to serve the needs of the people, not the other way around.

The technical term is third-degree price discrimination, and think carefully before you decide it should be abolished. Everything from newspaper coupons to student discounts to matinee prices to frequent flyer upgrades to casino comps to doorbuster sales all rely on the same right to charge prices as the company sees fit (provided they don't screen on some protected category like race or religion). Are textbook publishers being jerks by charging higher prices to US customers? Yes. Does the US prohibit being jerks? No.

If you don't like the text publishers' practices, push your schools toward using open course materials or find/establish a publisher that doesn't play these games. A small saving on student loan debt is not worth taking a wrecking ball to the economy.

I have no problem with companies charging different prices in different markets. I should then have the option of buying from the cheaper market, should I choose.

The whole idea that once you buy and own a product, it's not yours to do with as you see fit is just asinine. No, I don't have the right to burn copies of a CD and sell them, but I damned due have the right to sell the original if I no longer want it (without keeping any copies myself).

An example of law creep: in the UK the "Regulation of Investigatory Powers Act (2000)" was introduced with the ostensible purpose of regulating the use of surveillance in serious crime cases, with only the police, intelligence services, and some major government departments (tax, health, etc) authorised for this. Subsequent amendment added a long list of other agencies leading to the dire and farcical state that by 2011 local councils were resorting to it eight times a day to investigate cases of school zoning, dog fouling, and smoking. So something sold to the public as being essential to fight terrorism was within a few years being commonly used to prosecute public nuisances.

Since when is price discrimination a 'right' ? Some of these SCOTUS justices are a few cards short of a full deck...

Price discrimination probably is a "right" -- but there is no right to a legal guarantee that such market segmentation will be effective, or accepted by the customers, in a free market.

And by the same criteria, customers would have a right to shop around for a better deal.

As a previous poster noted, why should the benefits of free market globalization accrue only to the corporations, and not to the customers?

And if you find the textbook in New Mexico cheaper than it is in Arizona, knock yourself out. Once a national border is involved, you are severely constrained in what can be moved. A book in your carry-on is not going to cause a problem, but systematic mailing of books from your overseas relatives is conducting international trade without an import license.

As someone who actually has to deal with it, unlike I imagine the "communism!" comments above, it's a very tough case. And I agree it's good to see them really getting down to the nitty-gritty.

To give an example, you want to put a product into (say) Poland. It's not cost effective to localise, but most Poles speak English well enough, so the distributor is happy with English goods. In Poland the $40 game is going to sell for $3, because otherwise nobody would be able to afford it.

Now, as the Justices noted, contractually the distributor most definitely isn't allowed to then send these $3 copies back to another territory and sell them for $40 (ignoring that you'd have to catch and then sue them to actually prevent it, but hey).

In this case you are probably in Polish packaging, so it's not quite as bad as a book where it is probably identical to the English version, at least in content.

<Note: Poland and the costs are just made up. So no posts about Polish GDP and average wages. It's just shorter to type than Kazakhstan or something >

Now - if every time you sold English product into a lower-cost territory you had it all scooped up and channeled back to compete with your 'full price' English product then there is going to be a simple outcome. No product into lower cost territories.

Now, copyright is most definitely not the tool for the job here - the list of horribles is just that! But hopefully it can now be seen that there are actual reasons for segmentation, and that is allows people to access goods which otherwise they could not afford.

Except that in the real world, games cost MORE over in those countries than here in the United States.

Bottom line is that these companies should be told "One price for the entire world, period and done with!"

Then, we would FINALLY get a legitmate price in America on games, movies and music of 30 dollars/10 dollars/10 cents a song finally.

No, you would see the same pricing you see today. Overall sales would be reduced however as the products would be only available to the elite in other nations. Especially in the case of media. I am not certain why you believe otherwise, or why you desire the third world to support your first world lifestyle...

pappypappy - I don't use the word communism lightly. But that IS what they are suggesting. They want the government to enforce their business model to charge rich people more than poor people. It may be cliche to use the word, but in this case its accurate.

No, they are not suggesting the government enforce their business model. This is a civil suit, not a criminal one, and civil court cases are the exact opposite of using the government to enforce private interests.

Quote:

Further, if the company can afford to sell the game for $3 in Poland, then why aren't they charging me $3? A free market would state that they sell it for some certain price to maximize profits. If that price is too much for Poland, that's unfortunate for Poland. However, that fact then creates opportunities in Poland for a cheaper product (maybe the open source book). The company is free to try and charge what they want, but the should be free to correct itself as necessary.

Nice set of assumptions. The reality is that in nations where these products are not price reduced, the products simply do not exist in many if not most cases. Oftentimes the local infrastructure simply does not exist to build the product, including expertise. Drug companies are another major example of price segmentation bringing products to the third world that they could never afford otherwise.

Since when is price discrimination a 'right' ? Some of these SCOTUS justices are a few cards short of a full deck...

Price discrimination probably is a "right" -- but there is no right to a legal guarantee that such market segmentation will be effective, or accepted by the customers, in a free market.

And by the same criteria, customers would have a right to shop around for a better deal.

As a previous poster noted, why should the benefits of free market globalization accrue only to the corporations, and not to the customers?

And if you find the textbook in New Mexico cheaper than it is in Arizona, knock yourself out. Once a national border is involved, you are severely constrained in what can be moved. A book in your carry-on is not going to cause a problem, but systematic mailing of books from your overseas relatives is conducting international trade without an import license.

Edit: typo.

I'm genuinely curious what law covers the requirement for that license.